Regulatory Outlook for 2023

January 23, 2023 | As DC attempts to settle into the 118th Congress (with much drama this year), it’s worth taking measure of the big issues pending in the regulatory arena. The major initiatives well underway, from BEAD and Digital Equity funding, to implementation of the CHIPs Act, to efforts to advance a national spectrum policy, will continue to drive the narrative in 2023. There are also a series of significant regulatory initiatives expected to grab headlines at the FCC. Here’s a brief look:

Interference on Spectrum Policy

As Congress hammered out the FY 2023 appropriations omnibus package last December, a long-awaited deal on spectrum policy and other wireless priorities imploded, leaving many open questions in its wake. While Congress did manage to tuck an interim extension of the FCC’s auction authority into the ultimate package, there is broad interest in reaching a more comprehensive deal as the 118th Congress begins its work.

Issues still in the throes include funding for the FCC’s rip-and-replace program, dollars to upgrade the nation’s 911 system and funding to train more telecom workers. Many hope for closer bicameral coordination as the debate moves forward, something that seems unlikely given the split chambers.

On the policy front, the debate will continue to focus on the contours of a National Spectrum Plan, including progress on the large tranche of mid-band spectrum starting at 3.1 GHz that has been identified for sharing between DoD and commercial operators. The House and Senate draft bills diverged on how to repurpose this spectrum, and Sen. Mike Rounds objected to including any language in the omnibus that would compromise the DOD’s authority over the band, so there is much to discuss.

At the FCC, 12 GHz remains the subject of fierce debate, as the parties await a determination by OET on whether terrestrial services can operate alongside existing satellite operations. Separately, the FCC has opened a proceeding to look at options for the adjacent 12.7-13.2 GHz band.

Broadband: It’s All About the Maps

All eyes remain on the FCC’s ongoing effort to produce new and comprehensive broadband maps. As the year opened, the states had until January 13th to challenge inaccuracies, with many states pleading for more time. Texas called for a 60-day extension, with Maine, Pennsylvania and Vermont seeking similar relief.

NTIA Administrator Alan Davidson acknowledged how essential the maps are to directing BEAD dollars and spending the money wisely, but he also made clear that “every month that we push back on these programs and delay is another month that we’re not getting money out the door and helping serve the communities who so desperately need to get connected.”

NTIA seems likely to push forward on the current schedule. Indeed, the agency has now awarded planning grants to all 50 states, Puerto Rico and Washington, D.C., for both the Digital Equity and BEAD programs, and the states are getting organized in earnest.

But as I previously noted, the level of detail the FCC is incorporating into the new maps has never been attempted before. The version released in December is a draft in every possible way and a meaningful challenge process is essential to fine tuning the serviceable address information and coverage data now amassed.

An Uncertain Path for Tech Regulation

Although 2022 saw bipartisan bills addressing both privacy and antitrust reform, well-funded ad campaigns by Big Tech effectively scuttled the efforts. Failed legislative packages included the Kids Online Safety Act, the Open App Markets Act, the American Innovation and Choice Act, and the American Data Protection and Privacy Act. While the competition and privacy concerns that drove these efforts will persist, the split chambers will likely make it even harder for Congress to overcome tech resistance to enact meaningful reform.

That doesn’t mean the debate on these issues won’t remain active in both chambers. And the tech platforms seem likely to spend the year defending themselves against charges from the GOP-led House that they improperly limit free speech.

The Open FCC Seat

President Joe Biden has re-nominated the entire slate of candidates that failed to be voted out in the last Congress, including Gigi Sohn for the vacant FCC seat. With Sohn’s nomination now re-submitted, some are hoping for a smoother path forward given the new Democratic majority in the Senate. But there are no guarantees in the nomination game.

Of course, once a third Dem gets seated at the FCC, that will surely set off the much larger debate around Title II and net neutrality, a debate that seems well past its prime in terms of necessity and relevance. With priorities currently turned toward the question of how to get all Americans connected to broadband, concerns about ISPs using their control over their networks to favor content are absent from the dialogue. But continuation of the NetNeut debate seems as inevitable as the tides, at least until the issue is finally resolved in the courts.

Also on the horizon is FCC action on the open digital discrimination proceeding. A NPRM was adopted in December and the FCC faces a statutory deadline to conclude its work on this Jobs Act mandate in the Fall. Given the complex nature of this issue, I plan to address it in a separate note.

The States Press their Own Regulatory Priorities

Finally, look for the states to continue to experiment with their own regulatory pushes. Of particular interest is state efforts to regulate broadband networks/products/pricing. Oral argument was held last week on New York’s appeal of a June 2021 decision from a district court to enjoin the state from enforcing its Affordable Broadband Act, which would have required broadband providers to make specified broadband offerings available to qualifying households at prescribed prices. The district court found that the law conflicted with the FCC’s deregulatory approach to broadband.

On the west coast, another district court found that California’s net neutrality law was NOT preempted by federal law, a decision that was affirmed by the Ninth Circuit in 2022.

Given these conflicts — and the latitude afforded the states in how they structure broadband dollar allocations — I expect some states will continue to forge their own paths forward on some of the big broadband policy issues, testing the limits of their jurisdictional authority as NY is already doing.

2023 came in like a lion in DC and I expect it will continue to roar.

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